Providing loans for national institutional change

Description

Providing loans for national institutional change involves allocating targeted financial resources to support reforms in governance, legal frameworks, and public administration. This strategy aims to strengthen institutional capacity, enhance transparency, and improve service delivery by enabling countries to implement necessary structural changes. By addressing systemic weaknesses and fostering sustainable development, such loans help remedy inefficiencies, corruption, and inadequate infrastructure, ultimately promoting more effective and accountable national institutions.

Implementation

In thirty-three years of operations in Latin America and the Caribbean, the Inter-American Development Bank (IDB) made 70 loans for US$5,600 million to finance planning and reform projects totalling US$8,400 million. Examples of planning and reform orientated loans in 1993 include among others: $102 million for financial sector reform in the Dominican Republic; $72 million and $20 million loans for modernization of the Guatemalan financial system; $23.6 million for non-conventional financial organizations in Nicaragua; and $65 and $15 million loans for an investment sector reform programme in Trinidad and Tobago.